3 Rentals in San Diego, what to do next...

5 Replies

I purchased a town home in 2015 with my VA entitlement, lived in the unit for a period of time and then rented it when I left for a deployment. Closed on a single family residence at the end of 2017, utilizing the remainder of my VA entitlement (plus had to put around 50K down to secure the loan since I was over my entitlement cap). I received orders to Virginia in 2018, and rented out that property. In May of 2019, I purchased my third home in San Diego with an FHA loan. At the time I did not have 20 percent to put down on the loan to eliminate the PMI so I opted to only put down 3.5% with the intention that I would refinance into a conventional loan 6 months later. This house is my primary residence. Without divulging specific numbers, I have almost enough cash in savings to refi my FHA loan into a conventional at which point I would like to rent this third home and get back in the market to purchase a multi-family unit, in which I would rent one of the units to myself. What is the best way to move forward with this? Leave the FHA loan in place, continue living in current property. Use the liquid cash I have saved to find a multifamily and get a conventional loan to fund it? Am I able to use the VA loan again, even though my VA loan is maxed- I have heard that the President signed a bill that lifts the VA cap? Leverage the properties I already own to fund my next investment- I likely have around 150K in equity between three properties. 

You can try to get the Line of credit out of those property equity?

I think the most important is to find deals under market value and have relationship with a local bank that can give you the loan. it's helpful to have a job or cash in the bank, mostly it's the deal that's hard to find.

@Richard K. You would need to refi your current VA loans or sell them to regain entitlement to your VA. At that point you would have the no cap VA come January of next year. So a few things to think about there. I know a guy in CA that could help you. DM and I can share his contact.

As for the FHA, Since it's your primary, you don't need at 70/80% LTV. you can refi at a lower percent. I did this with my house in NC. I paid a touch higher interest, but I dropped the PMI.

Good luck and hope that helps.

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So on the two VA loans I currently have outstanding, one is at 3.5% the other 4%, if I refinance those is it likely that my payment will go up? Or do you think a convention loan APR will stay close to the same? Can anyone else confirm this, if I refinance those 2 loans, will I gain the entitlement back and be able to use it with no cap? I was told recently that since it's not my first time buying, that there would be like a second tier restriction in which there is a max dollar amount based on county.

Kevin, can you go into more detail on what you mean when you say drop PMI with less than 20% equity in the property?

@Richard K. Hi Richard you have one of the lowest rates in the market. VA loans are the lowest. If you refi you won't go below 3.25. The refinancing costs will eat up whatever you will save in the long run.

You need a VA expert to really help you with this. PM me I can refer you to a colleague in Chula Vista who is a VA expert and has the options you are looking for.

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